Once upon a time in the retail afterlife, brands quietly went to rest.
Then along came Retail Ecommerce Ventures (REV) — the Miami-based outfit that bought up hulks of retail nostalgia such as RadioShack, Pier 1, Modell’s, Dress Barn and Linens ’n Things.
They started their venture with the cheerful promise of turning brick-and-mortar ghosts into click-and-deliver gold mines.
According to the Securities and Exchange Commission, that glow-up pitch may have been more glitter than gold mine...
On Monday the SEC dropped a complaint that reads like a startup cautionary tale with federal stamps: founders Alex Mehr and Tai Lopez are accused of running a roughly $112 million ponzi-style fraud scheme.
The filing alleges they “made material misrepresentations” to hundreds of investors between 2020 and 2022 — telling backers that their portfolio companies were “on fire” and that “cash flow is strong,” while quietly moving money around like a magician shuffling cards!
The SEC-style abracadabra, as alleged, worked like this: Mehr and Lopez raised capital by hyping individual brands, promising money raised would be invested in that specific firm, and then used a patchwork of loans, merchant cash advances, transfers from other portfolio companies, and funds from new investors to pay interest, dividends, and maturing notes.
“Contrary to these representations, while some of the REV Retailer Brands generated revenue, none generated any profits,” the complaint says bluntly.
How bad was it?
The SEC alleges at least $5.9 million in returns that were actually Ponzi-like payments funded by other investors rather than real profits.
The agency also claims Mehr and Lopez diverted roughly $16 million of investor money for their “own use.”
Those are headline-ready numbers, which is exactly the problem when you mix distressed brands, venture gloss, and eager capital.
REV’s playbook was part relic salvage, part reality-TV pitch: buy a faded retail name, promise a digital resurrection, and let investors jump aboard the nostalgia rocket.
It’s an easy PR script — who doesn’t love a comeback story! The alleged twist is that the comeback narrative may have been built on borrowed time and borrowed money from new investors rather than turning real operating profits.
The SEC’s complaint also takes aim at REV’s management resume roll-call.
Chief Operating Officer Maya Burkenroad — identified in court filings as Lopez’s cousin and described by REV as having “over 10 years of experience managing multi-million-dollar companies” — is accused of aiding the scheme.
The SEC says her experience was overstated: before REV she’d worked as a substitute pre-school teacher, a radio station promoter, and as an assistant to Lopez at a prior venture.
If the branding was aspirational, the disclosures apparently weren’t.
Neither Mehr nor Lopez immediately responded to media requests for comment — which is the corporate equivalent of a long, thoughtful silence at a very awkward dinner party!
There are lessons here for anyone charmed by the siren song of “legacy brand revival.”
First: don’t let a catchy brand name substitute for audited profits.
Second: when you’re told cash raised for Company A will only be used for Company A — ask for the paper trail.
And third: when someone says everything’s “on fire,” clarify whether they mean revenue is burning up or cash flow is setting off actual alarms.
This saga also raises a cultural eyebrow at an era that worships turnarounds and influencer-style narratives for corporate rebuilding.
In the age of social proof and glossy term sheets, it’s easy to confuse momentum for sustainability.
When the SEC aliases “alleged” for “accused” in a complaint, investors tend to get nervous — and with good reason.
If the SEC’s charges hold up, this story will become the textbook example of what happens when nostalgia meets sloppy accounting and ambitious PR — a retail resurrection that may have resembled a Ponzi dress rehearsal.
If the charges don’t, the defendants will get their day in court.
Either way, it’s a reminder that not every comeback tour deserves a headlining slot on your investment playlist.
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